U.S. apparel company VF Corp. and private equity firm Altamont Capital Partners bid 526.8 million Australian dollars (US$556 million) for the company Monday afternoon, matching an existing bid from a former director and private equity partner. Billabong’s shareholders have gotten their hopes up only to see bids fade in the past, but there’s good reason to believe this time may be different.

Last month, the embattled surfwear maker said it received a takeover offer at that price, a 12% premium at the time, from a buyout team that included former Americas head Paul Naude and private equity firm Sycamore Partners. But in the same breath, Billabong’s management said profit for the financial year could be as much as 44% below prior forecasts. It wasn’t clear whether that bid would stick–Citigroup put a mere 20% probability on it being successful.

Billabong shareholders have seen a number of offers come and go – private equity firms TPG and Bain were both bidding for the firm at one point last year but have since lost interest. Bain came and went in a matter of weeks. And TPG, despite multiple attempts to buy Billabong, seems to have moved on.

That VF Corp. and Altamont Capital are bidding after Billabong’s earnings downgrade is a sign they’re not scared off by the headwinds facing the company. Billabong’s latest earnings downgrade was due to deterioration in Canada and Europe – Citi said margins on the earnings before interest, tax, depreciation and amortization line should be around 5.9% in fiscal 2013, nearly half the level from two years ago.

VF Corp. certainly has the expertise to help turn that around, managing successful global brands like The North Face, Lee and 7 For All Mankind. Plus the company’s cashed up: In October, management said it expected cash flow from operations to hit a record of US$1.2 billion in 2012.

It’s unclear why they’re working with a private equity firm. Billabong’s stable of brands is expansive – including niche names like Von Zipper, Element and Tigerlilly – so it’s possible the firms each want different parts of the Australian company’s business. That’s not to say shareholders should rule out Mr. Naude, who worked at the company for 14 years, most recently having managed the Americas business.

The two parties will likely conduct due diligence before considering upping their bids. A higher price could be in the offing–Nomura says the current $1.10-per-share offer on the table from both parties is “materially below” its long-term valuation for Billabong.

Shareholders who have been waiting awhile for a happy ending may finally be closer to getting one.

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Deal Journal Australia is an up-to-the-minute take on the deals and deal makers that shape the Australian landscape, including mergers and acquisitions, capital raisings, private equity and debt markets. In short, wherever money changes hands. Deal Journal Australia is updated throughout each trading day with exclusive commentary, analysis, data, news flashes and profiles. The Wall Street Journal’s Gillian Tan is the lead writer, with contributions from other Journal and Dow Jones reporters and editors. Send news items, comments and questions to gillian.tan@wsj.com.

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